Binance CEO Tries To Stem Hemorrhage After FTX Collapse

Binance boss Changpeng “CZ” Zhao has sent a “personal” email to retail investors who use his centralized exchange, telling them everything is above board on the world's largest crypto platform after auditors abandoned the company and investors complained about the opacity of Binance finances, Brian McGleenon reported for Yahoo Finance.

Photo Insert: Binance and Zhao are under investigation in the US and 13 other jurisdictions for money laundering and using the platform to transfer $10 billion in illicit money as well as launder $250 million in five years on behalf of crime syndicates.

The email was addressed to the community of “Binancians” in a confidence boosting exercise for customers on how funds and wallets are managed at Binance. The Binance boss stated that it conducts "a daily reconciliation of all crypto-assets that are held by Binance on behalf of its customers."

Zhao could only produce proof of reserves but could not indicate whether or not Binance’s money is in Beijing or Shanghai and being used by Xi Jinping. Zhao added: "We only spend our own funds. We do not use client funds to deal on our own account."

Zhao emphasized that "Binance holds all of its clients’ crypto-assets in segregated accounts which are identified separately from any accounts used to hold crypto-assets belonging to Binance and that it also uses Binance’s own wallet infrastructure to safeguard user assets and Binance’s own assets."

In the wake of the implosion of the FTX cryptocurrency exchange, competitor centralized cryptocurrency exchanges such as Binance and Coinbase (COIN), are making strident efforts to reach out to their community of customers, and the media, to allay fears that a similar fiasco could occur on their platforms.

Binance and Zhao are under investigation in the US and 13 other jurisdictions for money laundering and using the platform to transfer $10 billion in illicit money as well as launder $250 million in five years on behalf of crime syndicates.

Reportedly, more than $15 billion have been withdrawn by investors who fear Zhao may be arrested and prosecuted in the US, which may come sooner rather than later.

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